United States V. Stein: Unconstitutionality of Prosecutorial Consideration of a Corporation's Advancing Legal Expenses to Employees in Corporate Charging Decisions

In the March issue of Engage George J. Terwilliger III and Darryl S. Lew treated at length certain aspects of the Department of Justice’s guidelines for prosecuting business organizations.1 Binding on the various United States Attorneys2 and embodied in a 2003 memorandum written by Deputy Attorney General Larry D. Thompson entitled Principles of Federal Prosecution of Business Organizations (Thompson Memorandum), these guidelinesmade a business organization’s cooperation with federal prosecutors a significant factor in the prosecutor’s decision to charge the entity itself and not merely the individual employees or agents responsible. Terwilliger and Lew considered those provisions of the Thompson Memorandum under which prosecutors may demand (and very often receive), as part of a corporation’s cooperation with prosecutors, waivers by the corporation of attorney-client and attorney work-product privileges, especially as pertains to documents generated by outside counsel in a special investigation of the underlying wrongdoing.